How to hire a chief operating officer (COO)

In the bustling world of business, where CEOs, CMOs, and CTOs are treated as superstars and are often seen as the face of the organization, COOs work quietly in the shadows and make sure business operations are running as planned.

COOs, or chief operating officers, are the architects of operational excellence and are some of the most important figures in a company’s hierarchy. 

While a CEO might have ambitious visions about the business and the company, it’s usually the COO that brings those visions to fruition. Every organization past a certain size needs a skillful and experienced COO that can handle business operations and lead them to success.

If you’re a business owner wanting to know how to hire your next – or first – chief operating officer, you’ve come to the right place. In this article, we’ll take a closer look at COOs, what they do, and how you can streamline your COO recruitment process with the help of skills-based assessments.

What is a chief operating officer?

A chief operating officer, or COO, as they’re commonly known, is the glue that binds the various departments, teams, and functions of an organization – and makes sure that all elements are functioning smoothly. 

They are just below the CEO in a company’s hierarchical structure and play a crucial role in turning high-level strategies into actual projects, driving operational excellence, and creating a culture of collaboration and efficiency.

COOs play a pivotal role in achieving organizational success and realizing the long-term objectives of the company. They track the performance of employees, introduce process improvements, and manage several risks to enhance operational efficiency and ensure business continuity.

Chief operating officers’ hard skills

To be successful in their roles, COOs need several hard skills to enable them to build, manage, and optimize processes, create business strategies, manage budgets, and ensure the smooth communication between departments and business units.

Let’s look at the most important hard skills every COO should have: 

Operational strategy 

A COO needs to have a sharp strategic mindset so that they can develop comprehensive operational plans to support the company’s overarching goals. They are responsible for:

• Identifying growth opportunities

• Keeping an eye on competitors

• Analyzing market trends

• Creating strategies that help increase efficiency, reduce costs, and drive revenue

Process optimization

Identifying bottlenecks and inefficiencies in different processes and across various departments is one of the main responsibilities of a COO. They should be adept at finding solutions to optimize business processes. This might require them to: 

• Reengineer processes

• Implement lean methodologies

• Automate processes to streamline operations and improve productivity

Financial management

While they don’t have to take up a CFO’s (chief financial officer) responsibilities, a COO must have strong financial acumen. They have to manage budgets, allocate resources effectively, and make data-driven decisions that contribute to the overall financial health of the organization. 

Having skills in financial analysis, budget forecasting, risk assessment, and cost management can be very helpful for that. 

Project management

One of the fundamental responsibilities of a COO is to oversee large-scale projects that can impact the entire organization. 

To plan, execute, and monitor projects effectively, COOs must be familiar with project management methodologies such as Agile or Six Sigma. They need to make sure that every project is running on track and will be delivered within the allocated budget and on time.

Technical proficiency

As technologies advance every day and become an integral part of every modern business, it’s the duty of a COO to stay on top of new developments – especially the tools that help them do their work more efficiently. Examples include: 

• Enterprise resource planning (ERP) systems

• Data analytics tools

• Issue tracking systems, and more

Chief operating officers’ soft skills

COOs are responsible for ensuring that business operations are efficient, which requires engaging with various stakeholders, from employees and department heads to external partners and sometimes even customers. For this, they need to be exceptional leaders, communicators, and decision makers.

Let’s look at COOs’ most important soft skills: 

Leadership

A COO is a member of the executive team – and they must act like it. They oversee cross-functional teams across various departments and interact with employees and team leads regularly. 

For this reason, a COO must have effective leadership skills and the ability to inspire employees to do their best work while upholding ethical standards.

They also serve as mentors and coaches to their teams, so they must be adept in guiding professional growth and fostering skill development. That’s necessary to ensure that the organization’s talent pool remains strong.

Communication

Your COO must be able to communicate with clarity and conviction when they share the organization’s vision and expectations with diverse teams across departments. 

Active listening and the ability to adapt their communication style to different audiences will also help them to build trust and rapport with teams.

Delegation and conflict resolution

COOs handle teams with diverse talents and capabilities. A successful COO will know which team member can complete a certain task and delegate it to them accordingly. 

Doing this efficiently creates a sense of autonomy and accountability in the employee and fosters a culture of responsibility within the organization.

COOs might also often encounter conflicts. To solve them, it’s vital that they possess effective conflict-resolution skills, such as listening actively to different perspectives and finding win-win solutions that benefit the organization’s interest.

Decision-making

To grow, businesses must constantly evolve and transform – and COOs must be capable of making informed decisions even in complex and ambiguous situations. They should be able to adapt to changes, pivot their strategies during uncertain times, and lead teams through transitions.

Efficient decision-making involves seeing the big picture and understanding how each decision impacts the organization’s bottom line. 

They must be skillful in analyzing market trends, understanding competitors’ strategies, and making proactive operational choices that align with the company’s goals and values.

Cultural awareness

COOs should aim to create an inclusive environment by understanding and embracing cultural differences, especially in a global and diverse workforce. They need to have excellent emotional intelligence to effectively recognize and respond to the emotions of others. 

COOs with high cultural awareness can provide constructive feedback and nurture a positive workplace culture.

How to test COO skills

Becoming second-in-command doesn’t happen overnight. COOs have a wealth of experience under their belt and often have recommendations from founders and CEOs they work with. 

However, selecting a candidate based mostly on their resume and industry connections might not be the best strategy for finding the right COO for your company.

To assess the true potential of candidates and not interview everyone that ‘seems’ like a good fit, you can ask them to take a skills-based assessment. It will assess every candidate’s skills by the same criteria and enable you to make an unbiased list of those candidates who are most suitable for the job.

You can use TestGorilla’s pre-employment skills assessments to shortlist candidates quickly and without bias. 

For this, you can create your own assessment by combining five tests of your choice and give every candidate an equal opportunity to prove their skills. 

Some of the tests you can include in a COO assessment are:

• Project management: Evaluate each candidate’s ability to manage project lifecycles, resources, and team members to reach business goals.

• Business operations management: This test assesses candidates’ ability to plan, organize, and oversee operations and enhance teams’ productivity.

• Leadership and people management: See whether candidates have the ability to influence and guide team members towards success.

• Problem-solving: Use this test to measure candidates’ ability to define problems and analyze data available for making correct decisions.

• Culture Add: Fill out a customized survey to build a Culture Add test that assesses your candidates’ alignment with your organization’s vision and values.

COO interview questions: Ask the right questions to find your next chief operating officer

Once you identify the candidates who have the right skills for the role, it’s time to invite them to an interview for an in-depth evaluation of their suitability for the role. 

Here are some questions you can ask your COO candidates: 

1. How do you define success in the role of COO?

2. How would you align the operations of our business with our core vision and mission?

3. Describe a time when you had to make a tough decision that was unpopular with the company's employees.

4. Describe a company you've worked with that underwent significant change under your leadership.

5. How do you handle situations where your position is at odds with the CEO or founder's opinion?

6. How do you decide which operational changes to focus on first, especially in a fast-paced environment?

7. What's the role of an organization's culture in its operations?

8. How do you ensure that new processes you build are customer-centric?

9. How have you integrated new technologies or tools into a company's operations to improve efficiency?

10. Where do you see our industry heading in the next five years?

If you need more ideas, check out our 53 leadership interview questions and our 25 interview questions for executive roles. 

Where to find COOs for hire

There are various recruitment avenues that you can explore to find a talented COO to lead your organization’s operations. Some of those are:

Internal promotions and referrals

Start by looking within your own organization. You should never overlook internal talent: Experienced managers in your organization might have exactly what it takes to step into a COO role. 

With the right internal mobility strategy, you won’t have to spend too much time and money on the COO hiring process – and the person you promote will already be familiar with the organization’s goals, values, and mission.

Additionally, you can also seek referrals from your existing employees. You never know who might be close to a potential COO that aligns perfectly with your company’s goals and culture.

Traditional job boards

If you can’t find the right person within your organization, then it’s time to go the traditional route of posting on job boards like LinkedIn, Indeed, and industry-specific platforms. You can post a detailed description of the job, responsibilities, and minimum qualifications required.

Job boards give you access to a wide and diverse pool of talent. Ask candidates to complete a skills assessment to see who has the skills you need and then proceed to interview those who show the most promise.

Networking and industry groups

Attending networking events, industry conferences, and business seminars can be a great way to connect with potential COOs and interact with them. 

Some industries also have professional events that cater to managers and C-suite professionals specifically. This could give you access to experienced COOs that have already worked in your industry and are familiar with its nuances.

How much does a COO cost

The salary of a COO can vary significantly depending on their experience, responsibilities, the organization’s size, and geographical location. COOs of large enterprises typically have higher salaries than those of smaller companies, but COOs of startups might also hold substantial stock options.

According to Glassdoor, the average salary of a COO in the USA is approx. $405,000 per year, which includes base pay and bonuses and stock options. The average base pay of a COO is $193,000 per year.

According to Indeed.com, COOs’ base pay range is lower, from $73,734 per year to $254,248 per year. 

This should give you an idea of how much you should offer your next chief operating officer depending on your company's size, the person’s experience, and where the company is located.

Chief operating officer (COO) job description template

Position: Chief operating officer (COO) for [industry and type of company, f.e. "a fintech startup"]

Location: [City, country]

At [your company name], we are dedicated to [briefly describe the company's mission or primary function, e.g., "revolutionizing the personal finance industry with AI-powered solutions"]. As we continue to grow and reshape our industry, we're looking for a skilled and experienced chief operations officer (COO) to join our executive team and support us in our growth.

As our next COO, you'll play a pivotal role in scaling the operations of our company, driving the execution of strategic business plans, and ensuring that our day-to-day activities align with our organizational goals.

Key responsibilities

As our next COO, your key responsibilities would be to: 

• Develop, establish, and direct the execution of processes to support the company's objectives

• Streamline current operational processes and introduce new systems and tools as necessary

• Measure the effectiveness of all internal and external processes

• Create and implement strategic plans to advance the company's mission and promote revenue, profitability, and growth

• Lead and guide a team of managers to ensure that the organization can achieve its business goals

• Help ensure compliance with all relevant regulations and laws

• Analyze operations, identify areas of potential improvement, and manage change

• Work closely with the CEO and all other members of our executive team to shape the future of the company 

• Establish strong relationships with external partners and stakeholders

• Identify business risks and ensure their management and mitigation 

Qualifications

To be successful in this role, you need the following qualifications: 

• A bachelor's degree in Business, Management, or a related field; a master's degree or an MBA is a big plus

• Proven experience as a COO or a similar leadership role, preferably in [your specific industry]

• Demonstrable competency in strategic planning and business development

• Working knowledge of data analysis and performance metrics

• Exceptional interpersonal, communication, and leadership skills

What we offer

We offer the following: 

• A base salary of [salary range], plus stock options and performance bonuses

• Comprehensive benefits package including medical, dental, and 401(k) plans

• The opportunity to shape the direction of a rapidly growing company, on track to becoming a market leader

• An inclusive and dynamic company culture: Innovation and creativity are central to our success

How to apply

If you want to take your career to the next level and help us build the future of [industry], don't hesitate to get in touch with us. To apply, [describe your application procedure here and mention skills tests].

Hire the best chief operations officer for your business

Hiring a COO is one of the first steps in building a successful and sustainable business that’s optimized for growth. Their expertise and knowledge come in handy for optimizing business processes and ensuring every operation is executed smoothly and till completion.

TestGorilla provides a series of tests to help you evaluate the skills and knowledge of every candidate for the role. You can streamline your COO hiring process with the help of our carefully curated tests (available in our test library), or you can create a personalized assessment by adding custom questions and using asynchronous video interviews.

Start a free trial of TestGorilla to see for yourself what your hiring process can look like. The right COO for your business is just an assessment away.